Twitter Stock Analysis, Valuation (NYSE:TWTR)

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$31.54 $0 (0%) TWTR stock closing price Apr 19, 2018 (Closing)
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Twitter
Updated on : Apr 18, 2018
previous close
TWTR 31.5 (0%)
NASDAQ 7295.2 (0%)
Closing Price On: Apr 18, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Internet Software
Sector :
Computer and Technology
5 Quarter Revenue
Revenue Growth
2017-Q4
$million
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
1.6%
Sector Average:
5.7%
5 Quarter Net Profit
Net Margins
2017-Q4
%
LTM Margin
Debt/Equity Ratio
Debt:
1.79B
Debt/Equity Ratio:
 0.36
Compared to the industry
Cash Flow
Operating cash flow:
$198.1M
Net Income:
$91.1M
PROS      CONS
Cash Flow
FCF Margin
Net Margins
High Debt Burden
ROE
PE Valuation
PS Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
TWTR PS :
9.6
Industry PS :
2.9
Sector:   Computer and Technology.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
1%
Return on Equity:
-2.3%
Free Cash Flow Margin:
21.6%
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Twitter Stock Analysis

14704 13 5

Our Twitter analysis throws up more reasons to sell than buy the stock, because it has historically underperformed on nearly every financial or fundamental parameter based on which companies are normally evaluated. We have analyzed twitter on various parameters like Twitter revenue growth, profits, and valuation based on PE (See: Twitter PE ratio chart), PS ratios, Twitter's assets and many more. Twitter stock analysis compares it with fast growing Internet industry peers, but still finds it to be expensive and risky buy right now.

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Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Twitter Inc Stock Rating 2.4/5

Should you buy TWTR stock?

  • The company has an operating cash flow which is 2.2 times the net income. We see this as a positive signal.
  • Twitter has a healthy FCF (Free Cash Flow) margin of 21.6%.

Should you sell TWTR stock?

  • Twitter posted an average Net loss of -4.4% in the last twelve months.
  • With a debt/equity ratio of  0.36, Twitter is highly leveraged in comparison to Computer and Technology peers.
  • Trading at a PE ratio of 630.8, TWTR stock is overvalued in comparison to industry average multiple of 25.9.
  • The company is trading at a price to sales multiple of 9.6, which is overvalued in comparison to the Internet Software industry average multiple of 2.9.
  • Twitter has a negative return on equity of -2.3%. This indicates that the firm is inefficient at generating profits.

Comments on this video and Twitter stock

Twitter has been a momentum stock as can be seen from Twitter stock price history, driven more by market sentiments and expectations of future growth and buyouts, rather than financial strength. Our Twitter share analysis indicates a very risky proposition with very high price to sales ratio and non-existent price to earnings ratio, as Twitter is yet to report any net profits. Our stock analysts find twitter stock to be a very risky proposition.